… and so here we have a thought that won’t dislodge from the gizzard meeting a blog in need of more thought randomization …

is panama’s famed esmeralda — now the subject of frenzied annual auctions and ever-escalating price records — the andy warhol of coffee? it’s a stellar, genre-bending, tell-your-neighbors kind of revelation, a cup this blog once offered to foldgers-only co-workers in full confidence that it would, in a sip, change their view of coffee. true.

but it’s also not 40 times as tasty as the ever-popular ethiopia idido misty valley, as the staggering price tag might indicate. in fact, this blog’s totally randomized aggregator of online esmeralda chatter (poaching mostly from twitter!) reports that tuned-in coffee drinkers overwhelmingly thought this year’s crop less amazing than past versions. (these people would be knowing and perceptive, but not *professional* cuppers. the point here being what serious coffee drinkers thought, as a proxy for specialty consumers, not what the credentialed cuppers said they should think.)

to a dull and obvious blog like this one, ‘twould seem to be the marketing of esmeralda, as the world’s most expensive coffee, that confers this value. the name, the price, the growing notoriety, at some point, add to what pure taste is worth. the ever-higher auction prices could be spawning ever-higher auction prices!

which may not be bad for specialty coffee in the short term — we’re pretty sure this blog has previously argued somewhere on these interwoven nets that the notoriety and rising prices will surely benefit high-end coffee in general. but what if the Brand — the esmeralda cachet — is the herald of numerous future estate coffee niches … in which value is increasingly divorced from taste? in which marketability IS value?

warhol was, of course, a shape-shifter and cultural wizard with the acuity to pierce the consciousness of even magazine readers and soup-can buyers. but what he left in his wake is undeniably the commercialization of art — or even commercialization AS art.

it’s hard to not to be happy about sky-high esmeralda prices. it is, after all, an extraordinarily subtle and delicious coffee. but this blog wonders if the phenomenon doesn’t end up kick-starting an uneasy trend, at least for those devoted to taste as a measuring stick.

p.s. this blog is fully aware that pieces of this idea bubbled up on twitter WEEKS ago, and even on the slow-plodding blogs. so what? sometimes it takes us YEARS to come up with the right analogy!

p.p.s. yes, this blog was able to dip its amateur schnoz into this year’s top lots. our faves: the $27.50-per-lb caballeriza and $29 san jose, though the reserva DID offer some of the most delicate little twists of lily and lime we can remember detecting on our own …

UPDATE: further evidence that the esmeralda’s price can’t possibly be all taste-based: sweet maria’s is now selling one of last year’s top mesmeralda lots at less than half the original price — while claiming the beans “are fresh as they day they came in!” given the scrupulous storage method, this is probably true. so, what has changed from a year ago?

Auction-type pricing is going to be determined by demand. The demand, in this case on the part of the coffee buyers, will correspond to whatever value they perceive. Profit, sales, marketing, etc. If the buyers get the R.O.I. they’re looking for, then the circle is complete.

A separate circle will be the price paid by the consumers for that coffee. If they perceive that whatever price of admission they pay gives them an appropriate R.O.I., then they’re happy. Many will be happy. Many will be dissatisfied. Everyone’s been in both of those camps at some point, with a multitude of different products and/or experiences.

Such is pricing, auctions, and consumerism.

I’ve had folks on both sides of the Harley-Davidson argument try to win me over (I hope to be in the market for a nice motorcycle some time in the near future). Many consider Harleys to be the only motorcycle that matters. Others consider Harleys to be completely overpriced compared to the quality of product. H-D has been around for over a hundred years, and they’re not going anywhere. Neither is the associated debate, though.

good points. part of the rumination, of course, is about the kinds of things consumers demand. (coffee with cachet!)

you say:

The demand, in this case on the part of the coffee buyers, will correspond to whatever value they perceive.

or maybe it’s whatever value they can create — using the price they’ve paid as a marketing value, no?

in (post)modern commerce, it seems that there’s this wild card that sometimes disrupts the neat circles you describe above. it’s “buzz,” or cachet, or status, or whatever you want to call it. it tends to cloud judgment, obscure objective values, feed on itself and also maybe not last very long.

i’m not saying it bad thing. i’m just saying it doesn’t bear much relation to taste. and we claim to be all about taste!

I think you’re hitting on something here: “it’s all about taste.” That’s a lot of hogwash.

I think there’s a lot of deception going on in our industry today. Many people like to tell the story that we “want” to pay higher prices for coffee – what kind of ridiculousness is that??? Perhaps we’re willing to pay prices commensurate with the quality but I just don’t believe that people really want to pay more than necessary.

Which brings me to the whole per pound cost thing. As an industry, we laud ourselves for paying higher than the C-Market or Fair Trade, but does that really impact the peasant farmer in a truly meaningful way? Many will argue that yes, we impact them greatly through the improvement of their coffee mills (to improve our quality) and the establishment of schools, but I have to wonder if this really propels their future?

Maybe it’s too early to determine but do all of these “improvements” translate into their children being able to rise out of their socio-economic class towards a brighter future of higher education and greater wealth? Or do these prices mean that a landowner is making the money while the workers are still getting it in the neck?

Further, as an industry, do we really want prices to rise to the level of CoE, let alone Esmeralda? How do you make our business work when the cost of a cup of drip necessarily rises to nine dollars?

I think we like to give a lot of fuzzy and warm-feeling talk in this business just to make ourselves feel better.

“in (post)modern commerce, it seems that there’s this wild card that sometimes disrupts the neat circles you describe above. it’s “buzz,” or cachet, or status, or whatever you want to call it. it tends to cloud judgment, obscure objective values, feed on itself and also maybe not last very long.”

I disagree. “buzz, cachet, or status” is part of the circle. It’s something that inevitably accompanies the ‘specialty-ness’ of specialty coffee. Not for every consumer, but a good portion of the Bobo populace out there will bite at the mere hint of cachet. We all do it, don’t we?

“i’m not saying it bad thing. i’m just saying it doesn’t bear much relation to taste. and we claim to be all about taste!”

A distinction needs to be made: “it’s all about taste,” at least in my opinion, is a professional declaration. The value-proposition to consumers will always be more than just ‘taste.’

i guess i don’t understand how “it’s all about taste” can be limited to a professional declaration. the way i hear people saying it, it’s a credo, a philosophy of life almost. how does that not translate across your business model? though i understand the distinction you’re talking about, nick …

jay: i’m not calling “naked emperor” on the credo, but i HAVE wondered if higher and higher prices really benefit the farmers. at the coffee conference last fall, economists were arguing the trend actually hurts most of them.

I can’t say if it really hurts or hinders the farmers – of course, if a poorly educated farmer class of people suddenly came across a windfall, would they spend that money towards improving the lot of their people for the future? I can’t say.

I just find that much of the “discussion” about higher prices is lip service. While our 3W industry talks about higher prices, do we really push for them? Instead of $2.25/lb, why not just pay them $5.50/lb – or whatever rate that would allow them to pull themselves out of their current socio-economic class?

Then the problem becomes similar to what we see in America today – an exodus away from agriculture through education for a better life elsewhere. Fewer farmers means greater cost and increased prices. Without a doubt, these thoughts are too simplistic in terms but I can’t help but find the discussion about “higher prices” to be ridiculous.

i guess i don’t understand how “it’s all about taste” can be limited to a professional declaration. the way i hear people saying it, it’s a credo, a philosophy of life almost.

Well, declarations of this kind are always going to be more about aspiration than explication, and I didn’t mean that it’s limited to anyone.

I guess my point was that as professionals will declare it as sort of a mission statement as a purveyor or crafts-person of coffee. The corresponding consumer may declare it, but that’s as a consumer, attempting to articulate their consumption patterns. Related, perhaps separated by a fine line, but I think they’re very different.

how does that not translate across your business model? though i understand the distinction you’re talking about, nick …

My business model? Frankly, my ideal would be to try to make few declarations of any kind, instead building on our core values, constantly challenging ourselves to do better. Too many folks seem preoccupied with making declarations while their actual skills or product don’t live up. If you’re truly “all about taste,” then there should be no need to make such a declaration if your product actually tastes awesome!

Even I read somewhere that price of Esmeralda coffee can get expensive — two years ago, a bidding war for one lot of its beans (one lot = 300 pounds) went for $130 a pound,breaking all previous coffee price records! It is unlikely that Esmeralda coffee will be that expensive this year, but the price is almost certain to be too hefty.